Lethrinus olivaceus was first formally described by the French zoologist Achille Valenciennes in 1830 with its type locality given as Anyer in West Java, Indonesia.

The family Lethrinidae is classified by the 5th edition of Fishes of the World as belonging to the order Spariformes.

[5] Lethrinus olivaceus has a body which has a standard length that is 2.8 to 3.4 times its depth with an elongated snout.

[2] This species is widespread in Indo-West Pacific, from Red Sea and East Africa to Samoa and Ryukyu Islands.

[6][9] It is a reef-associated species and it can be found in lagoons, in sandy coastal areas and in reef slopes, at depths of 1 to 185 m.[2][6] These very active and fast swimming fishes often occur in large schools, but adults are usually solitary.